Austinist: Condopocalypse Now: Auction at Brazos Place

tomt

Tue, 28 Apr 2009 20:06:42 -0600

One other crucial note - it is a reserve price auction, so the developers get to cherry pick which bids they accept or reject - thus, it is a way to sell a portion of their inventory immediately and grab a lot of PR for the building in the process. I'd guess they'll probably accept anything that's 85-88% or more of their current asking price and turn most others away. What will be most interesting is the fact that the next batch of condos (The Spring, The Austonian, the Four Seasons, and eventually the W) are priced far higher than 360, Brazos Place, or The Shore...so will Austin support them? And if not, what happens next?

Kim

Tue, 28 Apr 2009 18:02:28 -0600

If you were going to buy a condo, the Brown Building is the place to buy. Sure, this place is closer to the capital, but let me direct your attention to this hilarious yelp review: "Oh if only you were lucky enough to live in The Brown Building. But you're not. Not only is it about as centrally located as you can get downtown (8th and Colorado), but it has the best fancy cajun restaurant in Austin (Gumbos) and a cool martini bar (The Brown Bar) in its lobby. Some might tell you that you can get a much more modern and updated place at one of the many new high rises that are being built as I type, but it will never have the personality of this 60+ year old 'high rise'. And just when you thought it couldn't get much better, you find out it's registered on THE MOTHER FUCKING NATIONAL REGISTER OF HISTORIC PLACES. What's that? I live in a national monument? Yes I do. Wait...that means that if I own the place, I save THOUSANDS on my property taxes every year? Affirmative. And you're telling me that someone just put a WINE VAULT in the basement of the building??? Well I'm actually not enough of a pimp to rent out a seperate space for bottles of wine, BUT I LIKE THE IDEA THAT I COULD. The Brown Building. You'll probably never live there. You should just kill yourself." Ah, if only I was so lucky. But yes, you people looking for condos- go with the Brown Building or one similar to it- lower taxes, established, and a true loft, not a fabricated new one. That said, the Commodore Perry lofts do seem pretty legit and are hella close to the capital. You just know their prices will bounce back because of location location location.

judegalligan

Tue, 28 Apr 2009 17:49:55 -0600

Outstanding.

puffy arizona

Tue, 28 Apr 2009 15:37:01 -0600

Downtown condo sales - and sales of all condos across the Austin region - have slowed down dramatically from two years ago while at the same time the amount of inventory has increased by more than 50 % in the same period. There is a lot of excess inventory. If the developer's best case scenario is to receive 80 percent of list price at auction for each of those units, how can you say prices are holding nicely? In the last year prices have fallen 20 percent based on price per square foot. Downtown condos sure aren't immune...in fact anyone who's trying to sell a condo for above $500k has probably given up and taken it off the market because there's almost nothing moving in that price range. The longer they can afford to wait the better but the fact is interest rates are about as low as they'll ever go and the buyers still haven't materialized. Anyone thinking about buying a condo for investment purposes only ought to think long and hard about their decision because a likely future onslaught of higher priced units will drive down prices across the board.

seth

Tue, 28 Apr 2009 12:26:07 -0600

If any of the existing tenants are upset that prices have been supposedly 'slashed' since they bought at list, at least they can use the reduced sales numbers when they go into combat with the Travis County Appraisal Review Board. Please, if you have been approved for a >$300,000 mortgage, go to this auction and buy a condo. Stay away from McMansions. Avoid looking on the Eastside. Downtown is where you want to be. Seth

LoudMouth

Tue, 28 Apr 2009 12:19:25 -0600

I am always right and I say this is just the beginning - a small leak in the boat before the whole ocean rushes in.

oh steph

Tue, 28 Apr 2009 11:39:17 -0600

A coworker of mine asked me yesterday whether I planned on attending this auction, and I laughed at him. Sure, the starting bid price is $80k, but that is for a 1 bedroom and that is just the starting price. Austin Towers hit the nail on the head by stating the obvious: who cares what the starting bid is when it is the winning bid that really matters. Plus, I don't want to live in a condo....

Shawn Shillington

Tue, 28 Apr 2009 11:07:57 -0600

I hadn't seen the Austin Towers post, but that is interesting. My expectation here is that we will see something similar - these condos selling for around 80% of the original asking price. I would like to see bigger reductions, but I think you are right that there haven't been nearly enough condos built downtown for that to happen. That said, "Condo Market Off Slightly" isn't nearly as exciting a headline as "Condopocalypse Now."

tim

Tue, 28 Apr 2009 10:59:37 -0600

Umm... last time I checked there were almost no downtown condos on the market, and the prices are holding up quite nicely. We didn't overbuild downtown. We overbuilt Buda, Manor, Round Rock, and Cedar Park. This explains why not only are the prices probably not going to be "affordable", but that this doesn't signify a crash: http://www.austintowers.net/Austin_Downtown/files/brazos_place_auction_analysis.html It's baffling why so many people want to live downtown and complain about how high the cost of housing is there, and in the same breath talk about how we could have a housing crash downtown. How would that even be possible? If you and everyone you know would be willing to buy a condo downtown if they got below $x dollars, then there's not going to be a development glut anytime soon and the more they build the better for everyone.